NOTE YOU HAVE TO CANCEL AT LEAST ONE DAY IN ADVANCE OR POINTS ARE FORFIET.
What you can do can also depend on what points were borrowed. If you cancel, those points (from the October trip) go into a holding account regardless. Those points can be used for a CHECK-IN date of no LATER than 12/12/09 (tomorrow it would be 12/13/09, etc.).
If your December stay is within that time frame and there are rooms available, you can book for those dates and cancel the corresponding dates of your December trip. Technically, when you cancel those rooms become available, but there is always the chance someone might snatch them unless they let you do it in one call.
If it is after 12/12, you just have to wait. The holding account points will stay until they expire at the end of your UY.
The points from the cancelled December room go back into the current use year. You can bank them, unless they were borrowed to begin with (or banked, but you only mentioned borrowing). If these were borrowed points, they stay in the current use year, which for you means they expire the last business day of August 2010.
If you can bank them, they need to be banked before May 1, 2010 (if my math is correct! You can book in months 1-8 of your use year).
I hope it works out! Remember, you can rent out points that you can't use on these boards! If all else fails, do that and use it for your dues!